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Chamber in the News

N.J. Dems introduce budget, but some lawmakers threaten not to vote

The Assembly Budget Committee meets in Trenton to discuss measures for next years budget. The Assembly Budget Committee meets in Trenton to discuss measures for next years budget. (Patti Sapone/The Star-Ledger)

The state Legislature on Thursday got down to the final steps of its annual high-stakes game of chicken, also known as approving the budget.

Democratic lawmakers introduced a $31.7 billion spending plan that borrows largely from the budget that Gov. Chris Christie unveiled in February. But a group of dissidents in the Assembly threatened to withhold their votes unless a controversial measure to reorganize the higher education system was shelved until later in the year.

The nine Assembly Democrats delivered a letter to Speaker Sheila Oliver (D-Essex) advising her of their demands. And with 48 Democrats in the 80-seat Assembly, the nine votes are essential to pass a budget along party lines.

As a result, Democratic leaders may either have to scramble for Republican votes — and make likely concessions — or derail the plan to consolidate some of the state's medical schools and health facilities.

Assembly Majority Leader Lou Greenwald (D-Camden) shrugged off the threat, saying he was confident the spending plan would ultimately get the Democrats' unanimous support.

"I am told we have 48 votes," Greenwald said as he darted around the Assembly chambers. "We'll be fine. I am not worried about it."

Minutes later, the man leading the gang of nine dissidents said Greenwald was sorely mistaken. "Tell Lou he should check his math," said Assemblyman Joe Cryan (D-Union), who was ousted as majority leader by Greenwald in January.

For Democrats, a party-line budget is crucial. Not only does their plan provide a political counter punch to Christie's proposed income tax cut, but also provides $133 million in additional funds for the working poor, nursing homes and other priorities.

Competing tax plans have dominated budget discussions for half a year, with Christie intent on slashing the income tax rate by 10 percent and Democrats offering an alternative plan that relies on a credit based on the size of residents' property taxes.

Christie, who has his eye on the national stage, has taken credit for Trenton's newfound appetite for tax cuts, but Democrats want to dash his victory tour by delaying the tax cuts until the governor hits his revenue targets, which are more ambitious than those of any other governor in the country. They have set aside $180 million to pay for the cuts if the revenue comes in.

The Republican governor's optimistic estimates are at odds with revenue collections and estimates by the nonpartisan Office of Legislative Services, which warns they may be short by $1.4 billion through June 2013.

"While I wish we were able to produce a different budget, this is the best budget given the hard economic conditions we continue to face in New Jersey," state Sen. Paul Sarlo (D-Bergen), the budget committee chairman, said moments before the panel approved the plan.

Before the day was over, Christie issued a short but bitter statement in which he attacked the Democrats for holding tax relief "hostage."

"Corzine Democrats are sending a loud, resounding no to tax relief for hard-working New Jerseyans because they'd rather repeat the cycle of the eight years before I became governor," he said, "raising taxes and fees every 25 days on the citizens of New Jersey."

Despite their wariness over Christie's revenue figures, the Democrats' budget would spend nearly all of the money the governor expects to come in, and they are relying on those estimates rather than cutting spending based on the less optimistic OLS forecast.

"It's hypocritical," state Sen. Kevin O'Toole (R-Essex) said. "They criticize the revenue estimates, then use them to build a budget."

Senate Democrats also said they could produce $140 million in new savings, but restless Republicans questioned Sarlo when he said the money would come from more aggressive debt collections at the state Treasury and adjustments to several accounts that never spend their allotted money.

The Assembly Budget and Appropriations Committee delayed a vote on the budget until today, and the plan is scheduled to be taken up by the full Assembly and Senate on Monday.

The Senate budget panel also endorsed a tax increase on millionaires today in another party-line vote, though Christie is expected to veto it swiftly, as he has done twice already.

Many of the Democrats' revisions would add more layers of legislative oversight to state spending, something Christie generally dislikes and removed from a previous budget. They are also calling for tougher controls on the state's system of halfway houses, which were the subject of a series of articles this week in The New York Times that found lax oversight.

Democrats also included $50 million to boost the state's Earned Income Tax Credit program for working-poor families to levels not seen since 2009-10 fiscal year.

They would also give nursing home operators $25 million, in addition to the $5 million increase Christie has proposed. With the federal government matching state spending dollar for dollar, the industry would receive $60 million, if approved.

Paul Langevin, president of the New Jersey Association of Health Care Facilities, said the industry would still be $15 million short because of last year's budget cuts.

But this was still a hard-fought victory. "We're delighted our message has gotten through," Langevin said. "This means some places will stay open — places that are taking the sickest of the Medicaid beneficiaries."

Star-Ledger staff writers Salvador Rizzo and Susan Livio contributed to this report.